Yesterday’s trading: A bid for Minerva could be Limitless

By Lauren Mills, Mail on Sunday Senior Financial Correspondent
Updated:

 

Shares in Minerva shot up faster than its developments after the London-based property company became embroiled in bid speculation.

London Stock exchange, trading floor

The property minnow's potential predator - called Limitless - has deep pockets, being the international real estate arm of Dubai World. Confirmation that Limitless was in the early stages of considering a bid for the company pushed the shares up 16p to 116¾p.

City traders reckon rival bids could be in the offing. The most surprising name being bandied around is steel magnate Lakshmi Mittal, although his recent investment in Queens Park Rangers shows he is not averse to taking a punt.

Another name in the frame was US developer LeFrak Organisation.

Just what it is that could be attracting such wealthy prospectors is, on the face of it, a mystery. Minerva is better known than its £188m market value would usually justify - mostly for the wrong reasons.

Its founders Sir David Garrard and Andrew Rosenfeld left after it emerged they were among the millionaires who made secret loans to the Labour Party.

Minerva's £500m Park Place shopping development in Croydon has been a long time in the planning and is unlikely to be completed until 2013 at the earliest, despite having John Lewis Partnership as its anchor.

And its flagship City skyscraper, St Botolph's, will end up more of a pavement hugger after plans for a 50-storey tower were scrapped in favour of a more modest 14 storey building.

Rumour has it potential bidders may be more interested in Minerva's uber-high-end residential schemes, including The Lancasters, overlooking London's Hyde Park. Apartments there are said to be changing hands for a heady £2,000 per square foot.

The Bank of England's decision to leave interest rates unchanged at 5% prompted renewed interest in commercial property shares. Quintain Estates, developer of land around Wembley Stadium, led the pack with a 37¼p rise to 447¼p, possibly on the back of renewed bid interest.

Other London developers to benefit included Great Portland Estates, up 15¾p to 479¾p, Derwent London, which finished 12p better at 1374p and Shaftesbury which gained 13p to 545p.

But, with the exception of Hammerson, up 6p to 1001p, the property giants had a downbeat-day time with Land Securities losing 1p to 1515p, and British Land flat at 833p.

A two-point slip in early-day trading on Wall Street, as gloom surrounding the credit squeeze refused to lift, failed to travel across the Atlantic with the Footsie up 9.8 points to 6270.8 as London shares mostly held their nerve.

The retail sector was buoyed by Next, which despite posting lacklustre results, soared 74p to 1302p. Home Retail Group, owner of Argos and Homebase, was 12¾p dearer at 280¾p while Marks & Spencer rose 15½p to 411p.

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HMV had reason to sing after rising 3½p to 149¼p on the back of a positive note from broker Citi, which forecasts a 3.5% rise in same-store sales when the music and book retailer gives a trading update today. By contrast, banking sector woes continued as nervous investors kept on bailing out. Barclays fell 12p to 463p, with HBOS down 6p to 513½p and HSBC losing 6p to 881½p.

Mobile phone retailer Carphone Warehouse was the biggest faller on the Footsie, down 10¼p to 289p, despite confirming a £1bn cash injection from Best Buy of the US. Traders said the market wanted a take-out rather than a joint venture.

ITV slipped 0.2p to 67.7p after Ofcom fined the TV company a record £5.68m for cheating viewers in several of its premium rate phone-in shows.

Engineering group IMI, up 13¼p to 478¼p, is expected to surprise the market with positive news today when it updates the market on trading.

White Young Green, an engineering consultancy, increased 8¾p to 329p after revealing Paul Hamer, the former managing director of VT Group, is to join in July as its chief operating officer. The firm also announced a string of new contracts, including a deal to project manage the £400m redevelopment of Clapham Junction.

Jeweller Signet sparkled up 5¼p to 77¼p after announcing that quarterly sales were 'only' down 2.5%. Cash-strapped Americans are still steering clear of its Kay and Jared emporiums, but on home turf H.Samuel and Ernest Jones are doing quite nicely.

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